Privatisation and Regulation of Urban Transit Systems

Posted on October 31, 2008 by Matthieu Desiderio

The Organisation for Economic Co-operation and Development (OECD) published on October 28, 2008 a document entitled “ITF Round Tables – No. 141 : Privatisation and Regulation of Urban Transit Systems.” I thought it might be of interest to those who are interested in “privatizing” their public transportation network.

Also, Transport Expertise team would be glad to receive any request and questions about the French “Délégation de Service Public” model (public service delegation, used by transit authorities who are contracting with a private company to operate – and more, their transit systems). We also ceise this opportunity to remind you that Transport Expertise recently published a report about innovative financing in the transit sector: “FIRST FRENCH-AMERICAN WORKSHOP ON PUBLIC TRANSPORTATION & INNOVATIVE FINANCING”, September 5, 2008 download the Executive Summary here, or order a free copy here.

No. 141 : Privatisation and Regulation of Urban Transit Systems

Urban public transport services generally run at a large deficit. This has led public authorities to seek efficiencies, notably through private sector involvement. Private entry is complicated by the essential network characteristics of public transport, with parts of the network potentially profitable and others perennially unprofitable.

Support for the sector traditionally seeks to provide basic mobility services to all segments of society, including low-income users. Intervention is also required to manage the natural tendency towards concentration and market power in the provision of these transport services. Policy towards urban public transport is increasingly aimed at managing congestion on the roads and mitigating CO2 emissions by substituting for travel by car. The sprawl of cities complicates the regulatory environment as responsibilities tend to be split among different institutional levels. (more on OECD website)

Source: Organisation for Economic Co-operation and Development, OECD

Please note that the document is also available in French (No. 141 : Privatisation et réglementation des systèmes de transports publics urbains). You can order the document on the OECD website here.

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